Marcellus Drilling News

Energy Companies | Southwestern Energy

Southwestern 3Q12: $145M Net Loss, Production is Up
November 2, 2012November 2, 2012

Southwestern Energy reported its third quarter financials and operations update yesterday. As with many other shale drillers, Southwestern posted a net loss for the quarter. Southwestern’s loss for 3Q12 was $144.8 million. Why? They blame low natural gas prices. Southwestern CEO Steve Mueller says the “main drivers” for the business are moving in the right direction—and that includes a “rapid ascent in activity and production” in the Marcellus Shale. Southwestern currently has 50 producing Marcellus wells, an additional 44 wells waiting for completion or to be hooked to a pipeline, and another 34 currently being drilled. They use four drilling rigs in the Marcellus.

Below are relevant sections of Southwestern’s lengthy 3Q12 update, including the operations update for the Marcellus:

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Best of the Rest

Marcellus & Utica Shale Story Links: Fri, Nov 2, 2012
November 2, 2012November 2, 2012

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:

Read More “Marcellus & Utica Shale Story Links: Fri, Nov 2, 2012”
Erie County (NY) | Hydraulic Fracturing | Industrywide Issues | New York | Research

UB CLEAR: Burn the Fracking Witches and Their Castle
November 1, 2012November 1, 2012

What happens when those who commit the academic “crime” of supporting the miracle of hydraulic fracturing won’t apologize or back down from their views, and the academic institution “harboring” them bravely defends their right to have a contrary-to-orthodoxy opinion? Those in the witch hunt sharpen their pitchforks and become even more shrill, banging at the gates, demanding the witches be burned and the department (castle) they work for be obliterated. That’s the situation at University at Buffalo (UB).

Yesterday a group of faculty members, led by an English professor, along with some of their impressionable young students (whom they’ve convinced that fracking is a sin against the renewable energy orthodoxy), sent a letter and “report” (full copy embedded below) to the SUNY Board of Trustees demanding the UB Shale Resources and Society Institute be shut down because they won’t admit to their crime of being pro-fracking. Yeah, real science and academic freedom rule at UB.

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Anadarko | Commodity Price | Energy Companies | Industrywide Issues

Anadarko: Gas Must be $4 Mcf Before More Marcellus Drilling
November 1, 2012November 1, 2012

An interesting comment yesterday from Anadarko Petroleum’s CEO about where price levels for natural gas have to be before he’s willing to commit more money for dry gas drilling. The magic number for Anadarko is $5 per thousand cubic feet (Mcf). Equally interesting was a comment by the VP of E&P that for the Marcellus Shale, the magic number is $4 per Mcf—because drilling in the Marcellus costs less than other plays. The current price of natural gas on the Nymex is currently $3.70 (as of this morning).

Until prices improve, Anadarko will stick to drilling in wet gas areas and not invest in Marcellus drilling. Here’s what Anadarko’s executives said yesterday on an earnings call:

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Hydraulic Fracturing | Industrywide Issues | New York | Statewide NY

JLCNY Endorsements for NY Elections – Solid Republican
November 1, 2012November 1, 2012

The Joint Landowners Coalition of New York (JLCNY) has provided New Yorkers with a handy list of endorsements from their organization for the upcoming election in a 14-county region (see the full list below). The offices they cover are either county, state or federal elections—mostly for New York State Senate and Assembly, with a few congressional and other offices on the list. The JLCNY has not endorsed candidates at the local town board level, instead referring voters to their local landowner coalition for guidance.

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Energy Companies | Guernsey County | Gulfport Energy | Harrison County | Ohio

Gulfport Energy Releases New Production Numbers for OH Wells
November 1, 2012November 1, 2012

Gulfport Energy is one of the few Marcellus and Utica Shale drillers who regularly reports on production results for its new wells (something we appreciate!). MDN told previously told you about Gulfport’s “King” of Utica wells, the Shugert 1-1H in Belmont County, Ohio, which produced 20 million cubic feet of natural per day, 144 barrels of condensate per day, and 2,002 barrels of natural gas liquids per day (see this MDN story).

Yesterday Gulfport released numbers for more new wells in Harrison and Guernsey counties in Ohio. Although the methane output of the wells is not spectacular, the condensate and natural gas liquids output is noteworthy. Here’s the latest report from Gulfport:

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Atlas Energy | Energy Companies

Atlas 3Q12: $10.1M Loss, Connected More PA Marcellus Wells
November 1, 2012November 1, 2012

Atlas Resource Partners, with some drilling operations in the Marcellus, reported the company lost $10.1 million for third quarter 2012. As part of their update Atlas reports making moves into other shale plays, picking up acreage in the Mississippi Lime play (in northwest Oklahoma). Atlas picked up acreage in the Barnett Shale in April of this year.

The only reference to the Marcellus in the update was that Atlas brought online some “additional legacy Marcellus Shale wells connected in southwestern Pennsylvania” during 3Q12. Here’s the full 3Q12 update:

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Blue Ridge Mtn Res/Magnum Hunter | Energy Companies | Triad Hunter

Triad Hunter Success: From 750 to 15,000 BOE/D in 2 Years
November 1, 2012November 1, 2012

Two years after Magnum Hunter bought out Triad Energy Resources, Triad is flourishing in the Marcellus and Utica Shale of Ohio and West Virginia. The company has gone from producing 750 barrels of oil equivalent per day (boe/d) to more than 15,000 boe/d. Triad just bought out another company (Viking International Resources, see this MDN story) and has added an additional 51,500 acres in WV and OH to their drilling portfolio.

Here’s the lowdown on the incredible success story of the company now called Triad Hunter:

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Commodity Price | Economic Impact | Industrywide Issues | Pennsylvania | Wyoming County (PA)

Oklahoma Manufacturer Buys Interest in PA Marcellus Wells
November 1, 2012November 1, 2012

This is a fascinating (to MDN) story about where the industry and economics for shale gas drilling may be heading. Yesterday LSB Industries, an Oklahoma City chemical (and equipment) manufacturer that depends on natural gas as its raw materials, announced they have purchased ownership interest in 14 producing natural gas wells, 7 soon-to-be producing wells and 36 yet-to-drilled wells in the Marcellus Shale, in Wyoming County, PA.

Why would a manufacturing company invest in natural gas wells? As a hedge against natural gas prices going higher—which they believe is going to happen relatively soon. They want a piece of the action that supplies their company with a key raw material, to keep their future costs down. Smart.

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Endeavour International | Energy Companies | SM Energy

Endeavour 3Q12: Income Way Up, Land Swap for Marcellus Acres
November 1, 2012November 1, 2012

A relatively young independent oil and gas company (started in 2004), Endeavour International, continues its rapid growth as reported in their third quarter financial and operational update. Endeavour has a large oil drilling operation in the North Sea. They also have a natural gas drilling presence in the Pennsylvania Marcellus Shale.

According to the 3Q12 update, Endeavour now owns about 31,000 acres in the Marcellus Shale leases (see the release below). However, last year Endeavour had a deal with SM Energy to purchase SM’s Marcellus acreage, which would have added 50,000 additional acres to their Marcellus portfolio (see this MDN story). For no publicly stated reason, Endeavour bailed out of the deal and SM threatened to sue last December (see this MDN story).

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1st NRG | Energy Companies | Utica Shale

1st NRG Corp Gets $7M Loan to Begin Drilling in Utica, Other Plays
November 1, 2012November 1, 2012

The Ohio Utica Shale’s newest entrant, 1st NRG Corporation, previously announced they would drill on 7,150 acres of the Utica Shale in eastern Ohio (see this MDN story). Yesterday they announced they have secured a $7 million loan which will help finance the drilling.

1st NRG’s announcement is, frankly, a lot of fluff aimed at reassuring investors. It’s big on broad descriptions of the shale plays where they plan to drill, but absent details about how and when that drilling will take place. Here’s the 1st NRG announcement:

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Energy Services | Williams

Williams Partners 3Q12 Update: Net Income Down 31%
November 1, 2012November 1, 2012

Williams Partners, the pipeline and processing subsidiary of energy giant Williams, released their third quarter financial update yesterday. Like many of the other energy companies with operations in the Marcellus and Utica Shale, Williams Partners did not have a good 3Q12 from a financial perspective. Net income for 3Q12 was $237 million, down from $342 in 3Q11 (31%). Why was 3Q12 tough for Williams and other energy companies? Low commodity prices for natural gas and natural gas liquids.

Relevant sections from the Williams announcement yesterday:

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Best of the Rest

Marcellus & Utica Shale Story Links: Thu, Nov 1, 2012
November 1, 2012November 1, 2012

The “best of the rest” – stories that caught MDN’s eye that you may be interested in reading:

Read More “Marcellus & Utica Shale Story Links: Thu, Nov 1, 2012”
Hydraulic Fracturing | Industrywide Issues | Litigation | New York | Statewide NY

53 NY Towns Ask to Join Fracking Ban Court Case
October 31, 2012October 31, 2012

While New York Gov. Andrew Cuomo dithers about whether or not to allow fracking in the state, two court cases that will have a profound effect on where fracking can happen (should he finally make up his mind) continue to work their way through the court system. Those cases address of the issue of whether or not local municipalities should have the right to completely ban fracking within their borders—sometimes referred to as “home rule.”

Not long ago MDN updated you on the status of those cases with word that oral arguments are likely to take place in February with a decision by late spring (see this MDN story). A new development in those cases: 53 municipalities have filed a request with the court to join the cases on the side of pro-ban/anti-fracking:

Read More “53 NY Towns Ask to Join Fracking Ban Court Case”
Economic Impact | Hydraulic Fracturing | Industrywide Issues | Jobs | New York | Statewide NY

NY vs ND Unemployment Rates: Why is One High, the Other Low?
October 31, 2012October 31, 2012

We interrupt this blog post to bring you the following news: New York’s unemployment rate is 8.2% (a full 9% in Chemung County). The Bureau of Labor Statistics reports that 345 out of 372 metro areas in the country (93%) have lower unemployment rates than the New York State average. The lowest unemployment rate in the country? North Dakota—at 2.2%.

Why is ND’s unemployment rate so low? And why is NY’s so high? Is there a connection?

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Commodity Price | Economic Impact | Industrywide Issues | Pipelines

Marcellus May Produce Additional 5Bcf/d of Gas in Next 14 Mo
October 31, 2012October 31, 2012

A blogger on the Seeking Alpha website says the Marcellus is “a ticking time bomb” waiting to “explode” with a tremendous amount of new natural gas production that will flood into the U.S. marketplace over the next 1-2 years. How much new gas? Blogger David White makes a compelling case he believes an additional 5 billion cubic feet of new natural gas will flow—from just the Marcellus Shale region—by the end of 2013.

Here’s his reasoning:

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